Report on Academic Skills for Accounting and Finance in Auto

This report examines the academic skills for accounting and finance within the automotive industry. It covers the historical development of accounting and finance, tracing its evolution from basic record-keeping to computerized systems. The report details the roles and functions of accounting and fi...Read More

Academic Skills for
Accounting and
Finance

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK ..............................................................................................................................................3
Historical development of accounting and finance :- ................................................................3
Roles and functions of accounting and finance :-.......................................................................4
Importance of accounting and finance :-.....................................................................................5
Future development of accounting and finance :- ......................................................................6
CONCLUSION ...............................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Accounting may be defined as the process of recording and summarising all the
transactions of the business which is related to the money(Fairchild and Hahn, 2020). Financial
accounting is basically a filed of accounting in which analysing and reporting of all the financial
transaction has been done. Management of the fund of a business is came under the financial
accounting. The accounting process focusses on internal accounting which result in reports and
financial accounting focus on the aggregating information into the financial statement. The
following report is based on the auto mobile industry. In this report the historical development of
the accounting and finance and the roles and functions of the accounting and finance has been
cover in relation to the auto mobile industry. This report also cover the importance of the
accounting and finance in relation to the chosen industry. Afterwords this report cover the future
development of the accounting and finance needed in the auto mobile industry.
TASK
Historical development of accounting and finance :-
The historical development of accounting and finance is more then just a story of
numbers and money. Is the story of evaluation from written record of document to the computer
accounting(Acikgoz, Miranti and Palmon, 2021). Accounting and finance is basically the
language of business and all the things which is related to finance. The historical development of
accounting has been classified into four stages. In the emergent stage the the accounting system
was not at all developed the exchange can be done using stones or by using any commodity.
After the evaluation of currency stage the accounting and finance of trade has become flourished.
In the pre- analytical stage different concept like duel aspect concept, going concern concept,
money measurement concept and many more has been introduced in this stage. In the
explanatory stage new method of teaching accounting by textbook publications has been
introduced. The introduction of the capital account, balance sheet joint stock formation and many
more has been introduced in this stage. American Institute of Certified Public Accountants
(AICPA), American Accounting Association (AAA) and many more has published the various

accounting principle. Generally Accepted Accounting Principles (GAAP) has been introduced in
the modern stage which make the accounting principle more meaningful (Jovic, 2021).
Roles and functions of accounting and finance :-
Accounting and finance plays a very important role in managing all the functions of the
company in a very effective manner. Money is being considered as an important part of the
business and it is very important for the management of the company to control over the money.
For this account and finance department within the company has been made which manage the
income, expenses and flow of money of business. The role and functions of accounting and
finance in relation to the auto-mobile industry has been discussed below :-
 Creating budgets and financial records :- By analysing the flow of money with the
help of proper accounting practices budgeting can be done in a very proper manner
(Hilorme and et. al., 2019). Basically in budgeting anticipation of the revenues and use
of the knowledge has been done which help in making decisions for the growth and
development of the company. This also help in good financial record keeping.
 Analysing financial performance :- in order to improve the present performance of the
company is is very important to analyse the past performance. This is being considered
as the most important role and function of the accounting and finance. With the help of
finance statements the performance of the can be effectively determined.
 Developing business strategy :- the most important objectives of all the organisation is
to earn more and more profit and with the help of accounting and finance proper
strategies has been made which help in achieving these objectives. The financial data of
the company is act as a chief tool, which help in understanding the economics of market
which ultimately help in developing the business strategy.
 Analysing costs of a business :- with the help of accounting and finance the cost of the
business has been effectively determined. It help in understanding the cost of the goods
and services in which the company is dealing and the sales volume of the company
which affect the profit margin.
 It helps in filing a financial statement :- it is very important for the business to filled
the financial statement with the registrar of the company. The entities who are listed in
the stock exchange, is required to file them and along with this, accounting and finance
is also help in direct and indirect tax filling.

 Inventory management and control :- the management and control of the inventory of
the business are in the hands of accounting and financial department of the
company(Hiebl and Richter, 2018). No other department can effectively manage the
inventory of the company.
Importance of accounting and finance :-
The first and foremost objective of the accounting and finance is to record all the
transactions of the company and make report of the financial performance of the organisation.
The importance of the accounting and finance has been discussed below :-
 Effectively record of business transactions :- accounting and finance is very important
form the business point of view as with the help of this systematic record has been
maintained of the financial information of the company. With the help of systematic and
up to date record the user of the data can effectively compare the information with
historical data(Karampinis and Lessis, 2021). Along with this the performance of the
company can be assess by the user over a long period of time.
 Help in decision making for management :- accounting and financial data is very
useful for the internal user of the company. The persons who are responsible for
planning, organizing and running the company use these information in order to make the
strategies for the growth and development of the company. Important decision has been
made by the management of the company with the help of accounting and financial data.
Form geographical expansion to improving the operational efficiency these data has been
used for decision making.
 Communicates results :- with the help of accounting and finance the result of the
company can be effectively communicate to the different user of the company. Most
importantly the external user like investor, lenders and other creditors of the company use
these information in order to analyse the performance of the company. With the help of
these financial report the investor can effectively buy the share and lender analyse the
risk in lending the money. Along with this the credibility of the company can also been
determined.
 Meets legal requirements :- with the help of accounting and finance the accurate
reporting of the liabilities and financial asset has been ensure by the company. The tax
authority United Kingdom such as Her Majesty's Revenue and Customs (HM Revenue

and Customs or HMRC) use the financial statement of the company in order to analyse
the declared net income and gross revenue of the firm. With the help of accounting and
finance the financial statements of the company are legally and accurately reported.
 Acceptability to others :- with the help of appropriate accounting and financial
statements the financial position of the firm can be effectively determined due to which
the sanctioning of the loan and requirements of funds can be effectively fulfilled. If the
accounts of the company are maintained in a disciplined manner then it can be easily
acceptable by others(Conley, Gonçalves and Hansen, 2018).
 Evaluation of policies :- with the help of accounting and finance the management of the
company effectively determined and evaluate the policies for the business. Due to which
they can run their business in a very successful manner.
Future development of accounting and finance :-
As the technology changes the applications of Artificial intelligence and Machine
Learning in finance has been grow. In order to interpreter the financial activities of a industry
data science, AI and ML has been used in different algorithms and pattern process. In the modern
era the evolve technology has been in identifying the fraud detection, and along with this
improving in areas like tax accounting, reconciliation, and accounts payable(Bonsón and
Bednárová, 2019). With the help of technology financial planning and analysis can be done in a
very effective manner.
CONCLUSION
From the above report it has been concluded that it is very important for the organisation
to effectively record all the transactions of the company which is related to money. These
financial data help in understanding the financial position of the company and also with the help
of these data user can effectively compare the performance of the company. This report
concluded the historical development of the finance and accounting from written recording to the
computer recording. Different types of roles and functions like creating budget, analyse the
financial position and many more has been performed by the employees of the financial
department and and with this report concluded the importance of accounting and finance in

relation to the auto mobile industry. In the end this report concluded the future development
needed in accounting and finance.

REFERENCES
Books and Journals
Acikgoz, B., Miranti, P. and Palmon, D., 2021. Accounting as a social practice: US railroad
regulation, value of service accounting, and regional economic
development. Accounting History, p.10323732211040275.
Bonsón, E. and Bednárová, M., 2019. Blockchain and its implications for accounting and
auditing. Meditari Accountancy Research.
Conley, T., Gonçalves, S. and Hansen, C., 2018. Inference with dependent data in accounting
and finance applications. Journal of Accounting Research, 56(4), pp.1139-1203.
Fairchild, C. and Hahn, W., 2020. Accounting and finance majors outperform other majors on
the major field test in business and the Comprehensive Business Exam: An analysis of
exam performance drivers. Journal of Education for Business, 95(6), pp.345-350.
Hiebl, M.R. and Richter, J.F., 2018. Response rates in management accounting survey
research. Journal of Management Accounting Research, 30(2), pp.59-79.
Hilorme, T and et. al., 2019. Human capital cost accounting in the company management
system. Academy of Accounting and Financial Studies Journal, 23, pp.1-6.
Jovic, D., 2021, October. Sustainability Accounting and Sustainability Reporting of Public
Sector Entities: Some Issues of Underlying Concepts. In Proceedings of 12 th SCF
International Conference on “Contemporary Issues in Social Sciences” (Vol. 7, p. 174).
Karampinis, N.I. and Lessis, G.D., 2021. Implied Cost of Capital and Accounting
Conservatism. Available at SSRN 3792974.